Professional Documents
Culture Documents
Management – Nature
and scope of
Operations &
Operations Strategy
By
Prof. Nadpurohit
Course Plan
Session Topics to be covered
1 Introduction & Course plan
•Nature and scope of Operations, Operations Strategy.
2 Types of Production Systems
Process Selection / Design, New Product Development
3 Facilities Location
•Plant Location Factors affecting Location,
• Plant Layout Types of Layouts
4 Strategic Capacity planning
Capacity expansion strategies , Forecasting methods,
5 Production Planning and Scheduling
Aggregate Planning, MPS, MRP
6 Scheduling Methods
Scheduling Objectives, Rules. Mid- term Test
7 JIT Methods
SMED , TPM, Lean manufacturing, Kanban
8 Inventory Management
Inventory Planning, EOQ, Inventory Control, ABC classification
9 Value Analysis/Project Management
Concept of Value, Methods of analysis.
10 Supply Chain Management
Case study
11 Quality Control
TQM, QC Tools, ISO discussion.
12 Recent Advances in OM
CAD/CAM, Productivity improvement, Recent advances in OM,ERP
End –Term Examinations
Operations Management By Prof.
July - Nov 2010 Slide 2 of 80
Nadpurohit
Reference Material
Text: Operations Management by B. Mahadevan.
Suggested Readings:
a)Operations Management by William J Stevenson
b)Production & Operations Management by Chase ,Aquilino.
Jacobs.
c)Quality Management .by P.N.Mukherjee
d) Production and Operations Management by K Ashwathapa
& Bhat.
Marketing Finance
Organization
Vision,
Mission,Goal
Operations
Control
Feedback Feedback
INPUTS
Materials
Equipment
Customers PROCESS OUTPUTS
Staff
Technology Goods and
Facilities services
SERVICE PRODUCT
Customer
INPUTS
Materials
Equipment OUTCOMES
Customers PROCESS Value
Staff Emotions
Technology EXPERIENCE Judgements
Facilities Intentions
SERVICE PRODUCT
Customer
Managing service and service operations
Service Operations
Salient Features
• Tangibility: Services are performances and
actions rather than objects, therefore having
poor tangibility
• Heterogeneity: High variability in the
operation system performance
• Simultaneous Production & Consumption:
Degree of customer contact is very high
• Perishability: Services cannot be inventoried
as in the case of manufactured products.
Source
* Monthly Review of the Indian Economy, CMIE, May 2005
# Joshi, D. (2004), "Indian Manufacturing: Price Vs Margin dilemma", CRISIL Rating Scan, November 2004,
21 - 25.
Source
Economic Survey of India, 2004-2005, Government of India, Ministry of Finance, Economic Division
Finance
Operations
Marketing HRM
Purchasing Public
Operations Relations
Legal
Personnel
Accounting MIS
Operations Management By Prof.
July - Nov 2010 Slide 23 of 80
Nadpurohit
Operations Function
Linkages with other functions
Testing Assembly
Layer of
Innovation Fabrication Machining
Innovation Supplier Layer
Strategy Service Delivery system
Sub-contractors Suppliers
Research &
Development Other service providers
Operations Management By Prof.
July - Nov 2010 Slide 24 of 80
Nadpurohit
Operations Management
A systems Perspective
Forecasting
PROCESSING
Labour Process & Purchasing & Goods
OUTPUT
Product Inventory
INPUT
Design Control
Material
Feedback
Quality Maintenance Process
Management Management Improvement
15 16
3 Process Project Supply Chain
1 Management
Design Management
Operations 6 13 17
4
Management: Product Statistical Just in Time Purchasing &
Trends & Development Quality Manufacturing Supply
Issues Control Management
14
5 Total Quality
Scheduling 18
Management Inventory
12
Resources Planning &
7 Control
Facilities Planning
Location 11 19
Aggregate Maintenance
2 8 Plant Production Management
Layout Planning
Operations 20
Strategy 10 Continuous
9 Capacity
Demand Improvement
Planning Forecasting
Operations Management By Prof. Improving
July - Nov 2010 Slide 34 of 80
Nadpurohit
Operations
Operations Management: Trends & Issues
Highlights
• Quality-based
strategies
– Focuses on maintaining or
improving the quality of
an organization’s products
or services
– Quality at the source
• Time-based strategies
– Focuses on reduction of
time needed to
accomplish tasks
Operations Management By Prof.
July - Nov 2010 Slide 46 of 80
Nadpurohit
Time-based Strategies
JAN FEB MAR APR MAY JUN
Planning
Designing
Processing
Changeover On time!
Delivery
Goals
Organizational Strategies
Functional Goals
• Economic conditions
• Political conditions
• Legal environment
• Technology
• Competition
• Markets
• Human Resources
• Facilities and equipment
• Financial resources
• Customers
• Products and services
• Technology
• Suppliers
Firm level
Strengths & Corporate Strategy
Weaknesses
Quality Cost
First Pass Yield Average days of inventory (No. of inventory turns)
Quality Costs Manufacturing cost as percent of sales
Defects (Parts per Million) Procurement costs
Number of suggestions per employee Value of import substitution, cost reduction
Process Capability Indices Target cost reduction efforts
Delivery Flexibility
Lead time for order fulfillment Number of models introduced
Procurement and Manufacturing Lead time New product development time
On time delivery for supplies Breadth and depth of the product offerings
Schedule adherence Process & Manufacturing flexibility
Indirect Measures
Direct labour to Indirect labour ratio Number of suggestions per employee
Lead time to work content Non-value added content in processes
Process rate to sales rate ratio No. of certified deliveries
Average training time per employee Delivery quote for customised products
Pro
ct
ess
d u
c
Pro tfolio
Por
Operatio
ns
l ogy no
System
Tec
S ai n
Strategic
ly
h
p
Ch
Options
up
Capa
city
often viewed as
competing dimensions in
Operations Strategy
Flexibility
Qual Qual
ity ity
Competi Competi
Flexib
Flexib
tive tive
ility
ility
Val
Co
ue
Prioritie st Prioritie
s of s of
WCM WCM
Deliv Spe
ery ed
Weak companies are plagued by Trade-off obstacles.
WCMs have gained an upper hand over the trade-off obstacles.
OPERATIONAL PROCESSES